It’s always a risk talking about the possibility of a coming recession because they’re such emotional things. Some people don’t even like to say the word.

Let’s say, for example, that we say the signs are that a recession is coming next year. If you’re not already fully protected against a contracting economy — and who is other than wealthiest, perhaps? — you cut your spending to the bone and try to save as much as you can to survive the carnage. Consumer spending stops, companies put the brakes on hiring and, maybe, start laying people off — and , voila, a contracting economy.

There’s also danger in whistling by the graveyard. If you’re not preparing for the coming recession, there’s a good chance you’ll be one of its victims.

Granted, economic predictions are often guesses by people with nice wardrobes and often they’re wrong. Sometimes they’re right. Who wants to gamble that CNBC’s story today predicting a recession in 2018 is wrong?

Employment is still healthy, economist Ardavan Mobasheri acknowledges. But he says payroll gains — jobs — in August were the worst in six years and, if history is a guide, it signals an economy running out of gas.

Twelve months prior to the start of the 2008-2009 recession, payrolls were growing at 1.55 percent. They were growing at 2.6 percent a year before the 2001 recession, and at 2.39 percent a year before the 1990 recession. In fact, payroll gains have averaged 2.67 percent 12 months prior to the beginning of all recessions since 1947.

He says not since 1947 has there been a period of payroll growth this weak that didn’t result in a recession within a year.

But, wait! There’s less!

Loans to business have slowed dramatically, according to Mobasheri.

No wonder the growth rate in jobs has weakened. Since the end of World War II, such weak growth rates in business lending have always occurred either during a recession or immediately following one.

And when combining these two all-important indicators, the picture becomes even bleaker. The American economy needs healthy business investment, hiring and consumer spending to sustain growth. And while business confidence surveys, especially for the small business segment, remain strong, they are not showing up either in the pace of hiring or in demand for credit.

The longest and deepest recessions tend to follow real estate busts, Ruchir Sharma wrote in a New York Times op-ed this week.

There’s a stock market that remains on fire while the economy itself is in a slow walk.

Nonetheless most economists — even conservative deficit hawks who worry about the Fed “blowing bubbles” — still look mainly for economic threats to the financial markets, rather than the threat that overgrown markets pose.

They thus don’t recognize fully that the world has changed, and the tail now wags the dog. Many mainstream economists still argue that the economy can’t be overheating if consumer price inflation is quiet, and they want to keep rates lower for longer, hoping that easy money will stoke growth in the economy, and jobs, for the poor and the working class.

However, since 2008, easy money has produced an unusually weak economic recovery alongside an unusually long and strong run-up in prices for stocks, bonds and housing. The rich own the fattest share of these assets, so wealth inequality is increasing. In addition, easy money is fueling monopoly power by helping entrenched companies borrow.

Consumer prices being low tends to fuel housing bubbles.

Asset prices from stocks to real estate have never been this expensive simultaneously, he notes.

About the blogger

Bob Collins has been with Minnesota Public Radio since 1992, emigrating to Minnesota from Massachusetts. He was senior editor of news in the ’90s, ran MPR’s political unit, created the MPR News regional website, invented the popular Select A Candidate, started several blogs, and every day laments that his Minnesota Fantasy Legislature project never caught on.

NewsCut is a blog featuring observations about the news. It provides a forum for an online discussion and debate about events that might not typically make the front page. NewsCut posts are not news stories.